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Nominal GDP targeting and the zero lower bound : should we abandon inflation targeting?

Billi, Roberto M. - 2013

I compare nominal GDP level targeting to flexible inflation targeting in a small New Keynesian model subject to the zero lower bound on nominal policy rates. First, I study the performance of optimal discretionary policies. I find that, for a standard calibration, inflation targeting under...

Persistent link: https://www.econbiz.de/10009761531

Business cycles when consumers learn by shopping

Gutiérrez-Daza, Ángelo - 2024

. Learning by shopping anchors households' beliefs about inflation to its past, causing disagreement with firms over the value of …

Persistent link: https://www.econbiz.de/10015069687

Expectations, Learning and Macroeconomic Persistence

Milani, Fabio - 2005

This paper presents an estimated model with learning and provides evidence that learning can improve the fit of popular …, developing a model that nests learning and some of the structural sources of persistence, such as habit formation in consumption … learning gain coefficient jointly with the 'deep' parameters of the economy. The empirical results show that when learning …

Persistent link: https://www.econbiz.de/10014061620

Nominal GDP Targeting and the Taylor Rule on an Even Playing Field

Beckworth, David - 2018

Some economists have advocated nominal GDP targeting as an alternative to the Taylor Rule. These arguments are largely based on the idea that nominal GDP targeting would require less knowledge on the part of policymakers than a traditional Taylor Rule. In particular, a nominal GDP targeting rule...

Persistent link: https://www.econbiz.de/10012936044

Experience-based heterogeneity in expectations and monetary policy

Radke, Lucas; Wicknig, Florian - 2021

Experience-Based Learning (EBL) that renders expectations heterogeneous across age groups. Under EBL, the age …

Persistent link: https://www.econbiz.de/10013330596

Suboptimal Equilibria from Nominal GDP Targeting

Hogan, Thomas L. - 2019

We use a simple model to illustrate that nominal GDP targeting might produce a suboptimal equilibrium if there is a growth-maximizing rate of inflation. Following a shock, we find that targeting nominal GDP might result in lower real GDP growth than the economy could sustainably produce given...

Persistent link: https://www.econbiz.de/10012904193

Inflation expectations, disagreement, and monetary policy

Hoffmann, Mathias; Hürtgen, Patrick - 2016

Survey data on inflation expectations show that: (i) private sector forecasts and central bank forecasts are not fully aligned and (ii) private sector forecasters disagree about inflation expectations. To reconcile these two facts we introduce dispersed information in a New Keynesian model,...

Persistent link: https://www.econbiz.de/10011520661

Learning to forecast and cyclical behavior of output and inflation

Adam, Klaus - 2003

the help of econometric models. Agents use least squares learning to estimate two competing models of which one is … consistent with rational expectations once learning is complete. When past performance governs the choice of forecast model …

Persistent link: https://www.econbiz.de/10009765344

Managing households' expectations with salient economic policies

D'Acunto, Francesco; Hoang, Daniel; Weber, Michael - 2019 - This version: August 2019

The empirical effectiveness of economic policies that operate theoretically through similar channels differs substantially. We document this fact by comparing an easy-to-grasp expectations-based policy, unconventional fiscal policy, with a policy whose implications are harder to understand by...

Persistent link: https://www.econbiz.de/10012057290

Managing households' expectations with unconventional policies

D'Acunto, Francesco; Hoang, Daniel; Weber, Michael - 2021

Binding lower bounds on interest rates and large government deficits limit the scope of fiscal and monetary policies to stimulate households' spending through financial intermediaries and firms. Policymakers have thus been implementing unconventional policies that aim to increase households'...

Persistent link: https://www.econbiz.de/10012490917

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